A Risk-On Stock Options Trade

How to maximize returns and limit risk with a few well-placed call options.

By

Steven M. Sears

January 23, 2012

By

Steven M. Sears

January 23, 2012

The Standard & Poor's 500 index is up about 4.6% since the year began, and one measure of the risk of owning stocks, the Chicago Board Options Exchange's Volatility Index (VIX), has fallen to the relatively optimistic level of 18.07.

Before the excitement of a rising market makes the flat overall performance of the 2011 U.S. stock market a distant memory, one lesson must be remembered: take advantage of alternate beats in the...